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Wisconsin Farm Bureau supports dairy reform bill

Wisconsin Farm Bureau President Bill Bruins announced his organization’s support for comprehensive dairy policy reform this week at the 2011 World Dairy Expo in Madison, Wisconsin.

“The time has never been more right for us as dairy farmers to take the steps to make our industry a reliable supplier to the world market with the products it both wants and needs,” said Bruins, a dairy farmer from Fond du Lac County. “This proposal is how we will get there.”

“The Wisconsin Farm Bureau has been a long-time advocate for dairy policy reform. Past attempts at federal dairy policy reform often resulted in modest changes that rewarded other parts of the country over dairy farmers in Wisconsin and the upper Midwest. Today, we have our best chance at true reform thanks to the work of the National Milk Producers Federation (NMPF) and the subsequent legislation from Minnesota Congressman Collin Peterson and Idaho Congressman Mike Simpson,” Bruins said.

“A key piece of this legislation is the elimination of the dairy price support program,” Bruins said. “This antiquated safety net never really helped farmers as intended. Instead, it ultimately encouraged processors to produce cheese for the government rather than dairy products that today’s marketplace wants.”

The Dairy Security Act of 2011 (HR 3062) also creates a voluntary safety net known as the Dairy Producer Margin Protection Program. Dairy farmers would be able to voluntarily sign up for this safety net that would provide assistance when the difference between the milk price and feed prices drops below $4 per hundredweight of milk. Additionally, farmers could buy additional coverage at higher levels.

When dairy farmers choose to participate in the government safety net, they will also be required to be part of the Dairy Market Stabilization Program. This temporary supply management program would kick in when milk prices drop below a trigger point. This two-part program would replace the current Milk Income Loss Contract (MILC) program. This part of the original NMPF proposal was controversial because it would have been mandatory for all dairy farmers. The revamped legislation from Congressman Peterson and Simpson changes this.

“Wisconsin Farm Bureau is very pleased that dairy farmers will have multiple options. They can voluntarily participate in this program, they can also choose to utilize risk management tools such as forward contracting on their own, or they can elect to do nothing at all,” Bruins said. “For once, dairy farmers will be able to choose their own destiny.”

The Wisconsin Farm Bureau Federation is the state’s largest general farm organization representing farms of all sizes, commodities and management styles.